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Fuel economy standards and promoting electric cars are piecemeal policies that cost too much and gain too little. If fiddling around the edges of greenhouse gas restrictions is all we can hope for in the current contentious political environment, so be it, but for the biggest impact at the lowest cost, what is needed is a wholesale cap-and-trade on motor vehicle fuels.

Yesterday, the White House lambasted Louisiana Sen. Mary Landrieu (D) for her hold on their nominee to head up the Office of Management and Budget. Her goal: to force the president to lift the offshore drilling moratorium put in place in the wake of the largest oil spill in U.S. history so that the regulations governing offshore drilling could be examined and overhauled.

“It’s as though the nation is walking into a casino and spinning the roulette wheel every day,” says Michael Liver­more, a government regulation specialist and executive director of the Institute for Policy Integrity at New York University law school. “It’s only a matter of time before we’re going to come up with snake eyes and have another disaster.”

Despite the loud cries to the contrary, there is an international consensus that the greenhouse gases that spur climate change have the potential to wreak havoc if aggressive action is not taken. A survey of 289 top economists released by New York University’s Institute for Policy Integrity in November found that most believe it would be cheaper to act now to prevent the worst potential effects of climate change than to deal with them later.

With thousands of barrels of crude still pouring into the sea after BP’s disastrous oil spill April 20, the downsides of offshore oil drilling have become all too clear.

That doesn’t mean that we should never extract the natural resources under our oceans. But it does mean we should wait until we can extract the highest possible price at the lowest costs to make sure Americans are being compensated for the enormous risks we take on when we allow drilling.

The choice of whether or not to drill is not a one-time decision; if we decide not to drill today, that does not mean we can’t drill in the future. Only the choice to drill is irreversible—once we use up a non-renewable resource, that’s it. The reserves of oil and gas offshore can be thought of as an option, one that has considerable value that we need to take into account.

“You have to look at everything, and no one looks at everything,” said Michael Livermore, director of the Institute for Policy Integrity at NYU Law School. Livermore recently co-authored a study on the economic impact of one of the environmental bills pending in the US Senate.

“Some people think it’s going to be terrible, some think it’s going to be really good,” he said. “You look at the different sectors and do as a good a job as you can.” Of course some might argue that the issue ultimately is not job creation, but saving our civilization from massive environmental turmoil.

J. Scott Holladay, an economics fellow at New York University School of Law’s Institute for Policy Integrity, says that some assumptions and omissions in the report call the huge GDP number into question. One of the biggest omissions, he says, is the option value of leaving the oil where it is.

Methane is a greenhouse gas 25 times more potent than carbon dioxide, so when it’s leaking by the ton, it’s a $50 billion problem. The New York Times described the phenomenon of methane leakage in a recent article which raised questions about the true costs of this waste.

EPA has been quietly working on some serious changes to the guidelines it uses to conduct cost-benefit analysis. Tweaks to the powerful but low-profile Guidelines for Preparing Economic Analyses could have major impacts on the environment. The Guidelines is little known outside of EPA, but is used in the design of every major environmental regulation.